S&P Lowers CIGNA Healthcare of SC FSR to 'BBBpi'.

Business Editors

NEW YORK--(BUSINESS WIRE)--Standard & Poor's

Nov. 21, 2001-- Standard & Poor's today lowered its financial strength rating on CIGNA  HealthCare of South Carolina Inc. (CHSC) to triple-'Bpi' from single-'Api'.

The downgrade reflects the HMO's decline in capital and increased earnings volatility, primarily because of substantial dividends paid to the parent of $12 million in 2000 and $10 million in 1999. The company does, however, receive the implicit support of its ultimate parent and has good risk-based capitalization, strong earnings, and very strong liquidity.

CHSC, incorporated in 1986, is based in Charleston, S.C. It is a wholly owned subsidiary of Healthsource Inc., which is a wholly owned subsidiary of CIGNA Health Corp. CIGNA Health Corp. is an indirect, wholly owned subsidiary of CIGNA Corp. (single-'A'-plus issuer credit rating).

Major Rating Factors:

-- CHSC's risk-based capitalization is good, as demonstrated by a Standard &
Poor's capital adequacy ratio of 108.5% at year-end 2000.

-- Earnings are strong, as measured by Standard & Poor's earnings adequacy
ratio of 169% based on financial statements for the five years ending Dec. 31,
2000.

-- Liquidity is very strong, with a Standard & Poor's liquidity ratio of 205.1%
based on its year-end 2000 statutory statement.

-- Enrollment is weak because of a decline in enrollment from 1996 to 1999.

Ratings with a 'pi' subscript are insurer financial strength ratings based on an analysis of an insurer's published financial information and additional information in the public domain. They do not reflect in-depth meetings with an insurer's management and are therefore based on less comprehensive information than ratings without a 'pi' subscript. Ratings with a 'pi' subscript are reviewed annually based on a new year's financial statements, but may be reviewed on an interim basis if a major event that may affect the insurer's financial security occurs. Ratings with a 'pi' subscript are not subject to potential CreditWatch listings.

Ratings with a 'pi' subscript generally are not modified with "plus" or "minus" designations. However, such designations may be assigned when the insurer's financial strength rating is constrained by sovereign risk or the credit quality of a parent company or affiliated group.